While the CARES Act included several provisions to bring initial relief to industry, the pandemic’s impact on small and medium-sized businesses is still ongoing and threatens to be lasting. While this effort represented a significant step to help the business community navigate these troubled waters, more relief is needed as NMMA members face unprecedented challenges.
NMMA is already communicating with the administration and members of Congress to ensure additional legislation goes further to protect employees and support small businesses.
Last week, NMMA, in coordination with the Marine Retailers Association of the Americas (MRAA) and Association of Marina Industries (AMI), spearheaded a joint industry letter urging congressional leaders to further support small and medium-sized businesses and manufacturers.
In this letter, NMMA detailed additional actions that would provide relief to the industry, including the following priorities:
Expansion of SBA lending authority to meet demand
We in the boating industry know that the severity of this economic impact on your businesses has created an immediate demand for relief funds.
While the Coronavirus Aid, Relief, Economic Security (CARES) Act made significant strides in securing $350 billion in relief for small businesses affected by COVID-19, greater relief and access to lending services is needed for businesses to stay afloat through this crisis.
NMMA strongly encouraged Congress to continue increasing the Small Business Administration’s loan authority in response to this growing need. This will help ensure that small businesses can adequately access SBA’s resources throughout progressing stages of the crisis.
Extension of payroll costs beyond eight weeks
The Paycheck Protection Plan created by the initial CARES Act provides total loan forgiveness for up to eight weeks of average payroll and other costs if the business retains its employees and their salary levels.
With states issuing new or expanded orders to extend mandatory business closures each day–potentially beyond the eight week maximum of loan forgiveness outlined in the CARES Act–there is a need to extend this threshold.
We believe that increasing loan forgiveness for payroll costs by adding an additional eight weeks, or so long as a state’s emergency order remains in place, for businesses that retain employees and mostly maintain salary levels is crucial to help our industry members adapt to the prolonged closures of their businesses.
SBA affiliation rule waiver for recreational boating industry
A significant percentage of U.S. recreational boat builders are not able to access sources of economic relief from SBA’s 7(a) loan program due to the program’s particular regulations on size for loan eligibility.
Given that 85% of U.S. recreational boat manufacturers are small businesses, it’s imperative that the fourth stimulus package waive affiliation rules for businesses in the marine industry that would otherwise qualify under the SBA’s size standards for recreational boating businesses. NMMA has asked that Congress reconsider these strict standards for loan eligibility to encompass a greater number of struggling businesses.
Business interruption insurance
Existing Business Interruption Insurance (BII) plans, which are designed to assist businesses in the face of interruption to normal business operations, do not require coverage of losses incurred by COVID-19.
While we do not think that it is necessary to open up coverage to all diseases, we believe the magnitude of interruptions on businesses in the wake of COVID-19 warrants inclusion of this crisis in BII plans.
NMMA urged Congress to issue a requirement that BII cover losses incurred specifically from the current pandemic in order to help our industry members and businesses around the country recoup from the significant losses they are incurring.
Help Trade Recreation Associations Stay Afloat
Congress must reconsider its limitation that includes only Section 501(c)(3) within the definition of “nonprofit organization” for SBA loan eligibility and broaden it to include 501(c)(6).
Hundreds of major meetings and events in the U.S. – dependent on in-person attendance at convention centers, hotels and other facilities – have been cancelled. These annual meetings and events contribute more than $446 billion to the U.S. gross domestic product and directly support nearly six million jobs nationwide.